When there’s an affordable housing shortage, it helps to build affordable housing. But doing it can be anything but straightforward, especially in Oregon, where state policies effectively restrict construction.
The city of Bend has tried just about anything to increase the supply of affordable housing. It has reduced or waived development fees to the tune of about $1 million per biennium. It has expedited review and permitting. It has made it easier to build accessory dwelling units — granny flats. Bend collects a fee on building permits that the city turns around and uses to encourage affordable housing. It also sold off city land so housing can be built.
Bend is considering a host of new ideas, including waiving development fees for affordable housing, allowing fourplexes to be built in neighborhoods, and supporting tax credits for some homebuyers.
Last year, Bend had made a total contribution of some $5 million toward affordable housing. Is Bend significantly more affordable? No. Those millions helped build hundreds of new units, but they’re only a fraction of what Bend needs.
The state of Oregon can argue it encourages affordable housing. It pushes density. It pushes lower parking requirements. But it also works against affordable housing by, among other things, requiring higher “prevailing wages” be paid on public projects, driving up costs.
The state also artificially increases the price of land through its urban growth boundary system. In a high-growth area like Bend, this has been a recipe for failure. Permission for Bend’s most recent expansion took years. It’s going to take years more before a significant amount of that new land will be ready for homes.
Changes to the prevailing wage law or the land use system are incredibly sensitive. The goals of those laws compete with the goals of building affordable housing. At least, the Legislature has acknowledged there’s something wrong with the land use system. It passed a bill in 2016 to allow two cities to develop affordable housing on up to 50 acres outside their UGBs without going through the normal expansion process. The pilot programs still have not been chosen.
Unless Bend and other communities put pressure on Salem to change the state’s land use system, affordability will continue to be a serious problem in popular places such as Bend.